Dis-Chem shares plummet in wake of poor trading update

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The share price of Dis-Chem Pharmacies [JSE:DCP] was down 9.5% on Monday afternoon, following a trading update on Friday where it announced it was expecting a decrease of over 35% in its headline earnings per share for the six months ended August 31. 

In an update to shareholders on Friday, the retail pharmacy group said it expected to announce earnings per share and headline earnings per share of between 30.7c and 31.7c for the half-year to end August, a decrease of between 37.5% and 39.5% compared to its restated H12019 results. 

According to Dis-Chem, a number of once-off earnings and costs had negatively impacted its first half earnings, including an unearned rebate release of approximately R81m, a change in the group's bonus policy; and strike-related costs. 

Dis-Chem shares were trading at R21.44 per share at 16:30 on Monday, down 9.55%.

Its rival Clicks [JSE: CLSreported strong profit growth in the year to end-August in late October, with diluted headline earnings per share up 16.8%. 

The share price of Shoprite [JSE:SHP], meanwhile, jumped by 6% in opening trading on Monday after the group reported turnover growth of more than 7% in the three months to September. By late afternoon on Monday the group's share price was down 0.87% at R136.02.

Dis-Chem will release its results for the six months ended August 31, 2019 on Thursday, November 7.


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